Eligible and Qualified Pension Income for the Pension Tax Credit

Income Not Eligible for Pension Tax Credit

Eligible Pension Income

Eligible pension income includes qualified pension income (see below) and, for taxpayers who are 65 or older in the year, the following pension income:

life annuity payments from a superannuation or pension plan, including life income funds (LIFs) and locked-in retirement income funds (LRIFs)
payments from a RRIF, which includes life income funds (LIFs) and locked-in retirement income funds (LRIFs) (and any reference to a RRIF always includes spousal RRIFs)
annuity payments from an RRSP or from a deferred profit sharing plan (DPSP)
certain payments on the termination or winding-up of a DPSP
regular annuities and income averaging annuity contracts (IAAC) reported in box 24 of a T4A or box 19 of a T5
foreign pensions, including US Social Security - the amount of foreign pension income that is not deductible on line 25600.
since tax year 2010, annuity payments from the Saskatchewan Pension Plan (SPP), which is a voluntary locked-in defined contribution pension plan available to Canadians in all areas, not just Saskatchewan.

The above types of eligible pension income and qualified pension income are eligible for pension splitting. See also our Pension Splitting article, which includes an additional 2 types of pension income as eligible pension income for purposes of pension splitting only.

See CRA information on eligible pension income.

Qualified Pension Income

For taxpayers who are less than 65 for the entire year:

life annuity payments from a superannuation or pension plan
payments from a RRIF, or annuity payments from an RRSP or from a DPSP, which have been received as a result of the death of a spouse or common-law partner
foreign pensions, including US Social Security - the amount of foreign pension income that is not deductible on line 25600.
since tax year 2010, life annuity payments from the Saskatchewan Pension Plan (SPP)

Quebec Pension Splitting

The June 4, 2014 Quebec Budget announced that taxpayers under 65 would no longer be able to split pension income for provincial income tax purposes, as of January 1, 2014.

Foreign Pension Income

Foreign pensions which are reported on line 11500 of your tax return qualify as eligible pension income, except

pension income that is tax-free in Canada because of a tax treaty
the portion of foreign pension which is tax exempt due to a tax treaty, and can be deducted from income on line 25600 of the tax return
income from a U.S. individual retirement account

See the Canada Revenue Agency topics:

Eligible pension income - scroll down to Foreign pensions

Line 25600 - Exempt foreign income

Tax treaties

Tax Tip: If you have pension or annuity income which is reported on line 11500 or 12900 of your tax return, it may qualify for the pension income tax credit and for pension splitting with your spouse.

Income Not Eligible for Pension Tax Credit

Income that does not qualify as pension income for the pension income tax credit:

Old Age Security or Canada Pension Plan benefits
Quebec Pension Plan benefits
death benefits
retiring allowances
RRSP withdrawals except for annuity payments
payments from salary deferral arrangements, retirement compensation arrangements, employee benefit plans, or employee trusts

Also see the Canada Revenue Agency (CRA) web page on Line 31400 (line 314 prior to 2019) Pension income amount, which includes a section where you can answer questions to determine if you are eligible to claim the pension income tax credit.

Back to Pension Income Tax Credit

Revised: November 23, 2025